Goldrunner: Gold Now on Its Way to $3,000+ By mid-2012

Our work with Gold is based on a “Model” off the late 70’s Gold Bull that has been replicating nicely since we started the Fractal Work with Gold back in 2002 and 2003. Short-term volatile moves in Gold, as we have seen over the past weeks, do not affect our projections based on the model, leaving the expectation of a move in Gold up to $3,000 into mid-year intact as outlined in our previous article entitled Gold Tsunami: on the Cusp of $3000+?Words: 996

Those are the views of Goldrunner (www.GoldrunnerFractalAnalysis.com) as conveyed in his original article* which was edited by Lorimer Wilson, editor of www.munKNEE.com (Your Key to Making Money!). Please note that this paragraph must be included in any article re-posting to avoid copyright infringement.

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The Gold Bull in US Dollars is a parabolic cycle that is created by the fall in value of the US Dollar.

1) The “US Dollar Index” has little relationship to the “Value of the Dollar” once the other paper currencies in the basket are being devalued aggressively. Thus, the Dollar is no safe haven except for very short periods of time late in major Gold Bulls. The global competitive currency devaluation process started in earnest in 2010 – much like it did in the late 70’s cycle. Once the GCCDs start in earnest, the US Dollar Index becomes little but a “fake pricing oscillator”, mostly moving sideways and inversely to the Euro, the largest component of paper currency in the US Dollar Basket.

2) The USD Index is trading much like it did at the same point in the late 70’s once it became a simple oscillator, and the analogous rise in the late 70’s suggests that it will top in the current period somewhere in the 81 to 84 area – and then it will move back down to its lows as Gold rockets higher.

3) Last week gold corrected down into the area of support near its long-term channel uptrend line on the arithmetic chart. The support came at the channel bottom and at angled line support over old tops as seen in the chart below.

Everybody is waiting with baited breath for the Fed to announce the next round of QE while looking at the false pricing index rise for the Dollar. The fact is that the Fed just announced the printing of $600 Billion of new Dollars that are yet to be factored into the $Gold price. That $600 Billion amount is equal to the total amount of the last course of QE that jettisoned the price of Gold in Dollars much higher, and we still expect the Fed to announce a round of QE on top of that so the US Government can pay its bills.

Back in 2007 we had pointed out the expected Deflation Scare correction that was obvious in the late 70’s Fractal Gold Chart. Working off the same Gold Chart Model, back then, we simultaneously pointed out the coming upside into early 2008, and the expected sharp drop into the 4th quarter of ‘08 on the same chart “model.”

There is no equivalent to “another deflation scare” at this point in the cycle off the late 70’s Gold Chart Model, and we believe it is for obvious reasons. The Gold Bull that is created by the aggressive Dollar inflation is driven into the form of a parabola by a relatively constant accelerating inflation of the US Dollar. We expect that the market will very soon turn its attention away from the false pricing Dollar Index, and revalue Gold sharply higher against the US Dollar due to the true increased supply metrics at hand.

THE $GOLD ARITHMETIC CHART

On the chart below you can see the lower channel in green that Gold traded within during the early part of the current Gold Bull running up the low channel base before busting out of the green channel with a huge move out of the top and into a more parabolic growth rate into the blue channel and then underwent parabolic growth as it busted upward into the blue channel.

At this stage in the late 70’s, $Gold made a similar sharp run higher and busted out of the top of the blue channel on the $Gold Chart, much like we saw as Gold busted out of the lower channel in 2005. This is how the Golden Parabola grows. We see a relatively constant acceleration in price per period of time – acceleration in price driven by the devaluation of the Dollar in response to more Dollars being printed in an accelerating way or Dollar Inflation.

If the Dollar Index reflected the value of the Dollar at this point in the cycle, the Dollar Index would have fallen to new lows as $Gold was revalued to new highs against the Dollar as it rose up to $1920, but it did not. The USD basically traded sideways to down from this point forward in the late 70’s while Gold was revalued massively higher against the Dollar into 1980.

Sharp volatility down into the channel bottom can easily be converted into sharp upside momentum if price bottoms and reverses causing investor psychology to reverse sharply.

THE 2008 DEFLATION SCARE GOLD CHART PROJECTIONS

Above and below, are two of the Fractal Gold Charts I posted back in September of 2007 showing where we were in the Fractal Model off of the late 70’s, using two of Dan Norcini’s Gold charts. Note the sharp correction into late 2008 that was denoted on one of the two charts for 2008. Also note that there is no similar sharp correction further along in the late 70’s Gold chart to match “a second deflation scare for today” as the parabola powered onward and upward.

There’s no corner of the market more emotional than gold investing and, with bullion down more than 10% this month and 20% since early September, a war of words has broken out among North America’s most influential bullion investors. [For an understanding of who said what, please read on.] Words: 1315

According to my 2000 calculations, if interest rates and inflation stay constant over the next 2 years, we could expect to see (with 95.2% certainty) a parabolic peak price for gold of $4,380 per troy ounce by then! Let me explain what assumptions I made and the methods I undertook to arrive at that number and you can decide just how realistic it is. Words: 740

I believe that the price of gold will… reach… $3,000, $4,000, and even $5,000 [per troy] ounce…during the course of this long-lasting bull market, a bull market that still has years of life left to it…[although] prices will remain extremely volatile – with big swings both up and down along a rising trend…The future price of gold is a function of past and prospective world economic, demographic, and political developments [and in this article] I review some of these developments and trends – so that you can come to your own “golden” conclusions. Words: 3800

With what is happening with the price of gold these past few days it is imperative to take a look at the long and short of it all (the trends, that is). In doing so it shows that we are still very much in a long-term bull market but in a short-term (yes, short-term) bear market. Let’s take a look at some charts that clearly outline where we are at and where we could well be going. Words: 625

Since the fundamentals still point to gold’s long-term viability… why [are] investors responding by selling gold…? I was always told not to look a gift horse in the mouth… [so] take advantage of the dip. Words: 962

Record lease rates are a primary driver for the near historic sell-off we have experienced but, when negative gold lease rates drop like they are now doing, the underlying tension in the supply and demand for gold as a source of liquidity collapses suggesting that the gold sell- off is likely coming to an end. That said, the next time we approach the previous thresholds..it will likely indicate that another gold-derived liquidity rubberband “breach” is imminent. [Let me explain further so you won’t be “had” next time.] Words: 1054

With the present major correction in gold, silver and the mining sector it is important to look at the big picture and see what the charts are saying from a technical fractal relationship with what happened back in 1979 when the last truely major bull run occurred. To date the situation is, frankly, no different than it was back then unfolding just as it should. As a result we can expect MAJOR upward price action in physical gold and silver and in their mining (producers, developers, explorers and royalty streamers alike) in the next few months on their way to their respective parabolic peaks in the years ahead. Read on. Words: 1604

Early this year we suggested a 50% rise in Gold to $1860 – $1,920 into mid-year. Now, we see the Gold tsunami realizing an approximate 100% rise that will crest at $3,000+ into the middle of 2012, drowning any doubters in its wake. Below are a number of factors that support that view. Words: 1250

From questions whether gold is in a bubble to predictions that soaring prices are just around the corner, one thing is clear: a new phase of awareness for gold is upon us. How far might it move before these troubling times are over? [Let’s take a close look at a variety of factors and scenarios before coming to a conclusion.] Words: 5717

The Elliott Wave Theory (EW) gives superb results in predicting the gold price. [While] it is a complicated system with many difficult rules [which] I explain in simple terms in this article, [I have determined that] once this present correction in gold has been completed it should [undergo] the largest and strongest wave in the entire gold bull market. The target for this wave should be around $4,500 with only two 13% corrections on the way. [Let me explain how I came to that conclusion.] Words: 1924

I have come out of retirement for this one off, once only, speech to warn that the good ship “Life As We Know It” is sinking. You have the choice of getting into a life boat now or going down with the ship. The life boats consist of precious metals and other assets that will survive the coming currency destruction. [Let me explain.] Words: 1400

You have no doubt read countless articles on the price of gold costing x dollars per “troy ounce” or perhaps just x dollars per “ounce” but the difference between the two measurements is significant. For that matter, what’s the difference between a 24 karat gold ring and an 18 karat gold ring? Let me explain. Words: 863

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